Contribution margin: The difference between the sales revenue and the variable expenses is called a contribution margin. Target Profit Analysis: It is an analysis of how much unit sales or dollar sales value must be attain to realize the target profit estimated by the company. Break-Even Point in unit sales: It is the unit sales where a company is neither making profit nor incurring any loss. Break-even point in dollar sales: It is the value of sales in dollar where a company is neither making profit nor incurring any loss. To determine : Computation of missing amounts for the table.

Question

Want to see the full answer?

Answer 1

Question

Chapter 21, Problem S21.8SE

To determine

Contribution margin:

The difference between the sales revenue and the variable expenses is called a contribution margin.

Target Profit Analysis:

It is an analysis of how much unit sales or dollar sales value must be attain to realize the target profit estimated by the company.

Break-Even Point in unit sales:

It is the unit sales where a company is neither making profit nor incurring any loss.

Break-even point in dollar sales:

It is the value of sales in dollar where a company is neither making profit nor incurring any loss.

To determine:

Computation of missing amounts for the table.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

answer plz

Repsola is a drilling company that operates an offshore Oilfield in Feeland. Five years ago, Feeland had a major oil discovery and granted licenses to drill oil to reputable,experienced drilling companies. The licensing agreement requires the company to remove the oil rig at the end of production and restore the seabed. Ninety percent of the eventual costs of undertaking the work relate to the removal of the oil rig and restoration of damage caused by building it and ten percent arise through the extraction of the oil. At the Statement of Financial Position (SOFP) date (December 31 2025), the rig has been constructed but no oil has been extractedOn January 1st 2023, Repsola obtained the license to construct an oil rig at a cost of $500 million. Two years later the oil rig was completed. The rig is expected to be removed in 20 years from the date of acquisition. The estimated eventual cost is 100million. The company’s cost of capital is 10% and its year end is December 31st. Repsola…

(a) A property lease includes a requirement that the premises are to be repainted every five years and the future cost is estimated at $100,000. The lessee prefers to spread the cost over the five years by charging $$20,000 against profits each year. Thereby creating a provision of $100,000 in five years’ time and affecting profits equally each year. Requirement: Was it correct for the lessee to provide for this cost? Explain your decision (5 marks) (b) A retail store has a policy of refunding purchases by dissatisfied customers, even though it is under no legal obligation. Its policy of making refunds is generally known. Requirements: Should a provision be made at year end (9 marks